Quote:
"The reason is that book publishers make less money from the agency model than they do from the traditional wholesale model (in which Amazon buys a book license at the full wholesale price, and then sells each copy for whatever it wants, often losing money on the sale)."

Isn't Random House the publisher that isn't planning to switch to the agency model?

Looks like it at this point, yeah (which is going to make the other members of Apple's little wannabe cartel unhappy, but that's life).

Of course Random House aren't exactly heroes either, what with their recent second attempt to steal electronic rights to backlist titles from authors who'd published with them in the past. You'd think Random House would have learned their lesson after the courts smacked them down in 2001, but they just tried again this past December.

Really, the agency model is like the old Net Book Agreement from the UK. Publishers set the price, and the retailers are supposed to fall in line, or suffer consequences. Being as how Macmillan is a UK spawned publisher, it only makes sense that they would want something that benefited them for nearly a hundred years.

However, I totally see how the cultural differences would have it so not everyone would be on board. Consumers are upset because it means they have to pay more, often more than they can afford without changing their purchasing habits. In the US, companies generally have gone with the volume sales method. People buy something and think they get a deal, and end up buying more than they would have other wise.

I think there's one potential benefit to the agency model that a lot of people have missed. The retailers/distributors will no longer be the publisher's customers. They will strictly be acting as a commissioned sales agent. The reader will become the actual customer. In theory, at least, it should make the publishers more responsive to direct market feedback. Sure, it would take some kind of sudden awakening in the publishing world, but financial statements have a way of sparking those.

Another factor is that the agency model actually plays to Amazon's strengths, which may be one reason we haven't seen any official corporate communication from Amazon decrying it. When price is not a factor, what's left with which to compete? The answer is service. Things like Walmart-style one-stop shopping, ease of use, and quality of customer service become more important factors. No one's likely to top Amazon in those areas any time soon.

Being as how Macmillan is a UK spawned publisher, it only makes sense that they would want something that benefited them for nearly a hundred years.

A UK-spawned publisher owned by a German conglomerate, in fact. Germany has had an industry-agreed-upon price-fixing agreement since 1888, and Germany apparently decided to buck the trend and pass a fixed book price agreement into law in 2000.